Queensland's corruption watchdog has exposed the detail of a nepotism scandal at the University of Queensland. The Crime and Misconduct Commission has revealed the Vice-Chancellor's daughter was given a place in the medical program although she didn't qualify.

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SCOTT BEVAN: Queensland's corruption watchdog has exposed the details of a nepotism scandal at one of Australia's leading universities.

A scathing Crime and Misconduct Commission report has revealed the daughter of the University of Queensland's Vice-Chancellor was given a publicly-funded place over hundreds of other students, even though she wasn't academically qualified for it.

The scandal was uncovered two years ago but it's the first time details of how it happened have emerged.

The University of Queensland acknowledges the institution has had problems with integrity and accountability, but insists there's been major improvements.

Stephanie Smail reports.

STEPHANIE SMAIL: In December 2010 the University of Queensland offered a place in its undergraduate medical program to the Vice-Chancellor Paul Greenfield's daughter.

She wasn't academically qualified, but it only took a few phone calls to make it happen according to Kathleen Florian from the Crime and Misconduct Commission.

KATHLEEN FLORIAN: Professor Greenfield whilst on leave contacted Professor Wilkin, who was then the head of the medical faculty. Professor Wilkin in turn contacted Professor Keniger, who was the acting vice-chancellor and a close colleague of Professor Greenfield's, and as a consequence that chain of communications, Professor Keniger ultimately made a decision to force an offer to Ms Greenfield into the medical program.

STEPHANIE SMAIL: Ms Greenfield was given a place ahead of 343 other students who were stronger on merit.

The CMC report says although rumour and innuendo about the issue was widespread among university staff, no-one reported the matter officially for nine months.

Kathleen Florian says the university also conducted an internal investigation, before alerting the state's corruption watchdog.

KATHLEEN FLORIAN: It's the CMC's position that the university, in balancing the protection of the university's reputation and the protection of the reputation of the officers involved with the public interest, did not strike the right balance.

STEPHANIE SMAIL: Both Professor Keniger and Professor Greenfield resigned shortly after the scandal went public. But the Crime and Misconduct Commission says it appears some sort of deal was negotiated between the University and the professors before they left the institution.

A section titled "consideration of financial benefits related to resignation dates" includes correspondence between the Chancellor John Story and other parties.

One of the excerpts reads:

(Extract from correspondence)

JOHN STORY (voiceover): Can we suspend him or put him on "special duties" for six months? Alternatively can we pay him six months' notice but still have him on holiday pay?

STEPHANIE SMAIL: Another states:

JOHN STORY (voiceover): Greenfield responded aggressively to the effect that I was reneging on the deal and raised the financial impact

STEPHANIE SMAIL: In the report, the University says the so-called deal was colloquial language referring to an agreement about a number of important projects that Professor Greenfield was involved in.

The current Vice-Chancellor of the University of Queensland, Professor Peter H, says he's glad the report is out so the institution can move forward.

PETER H: I think everyone would agree that what happened wasn't right and everyone will know that the former vice-chancellor and the senior deputy vice-chancellor are no longer here.

STEPHANIE SMAIL: Professor Greenfield's daughter is still studying medicine at the University of Queensland.

Peter H admits it's unfair she got into the course.

PETER H: But she was a 17-year-old girl who took no part in her own admission and had every reason to believe that she got in on merit. The question is then what does the UQ do if the student has not misled the university?

STEPHANIE SMAIL: Peter H is frank about the impact the nepotism scandal has had on the University of Queensland's reputation.

PETER H: Is this as bad as it gets? It's certainly not something you would want to happen too frequently. Can it get worse? Possibly can. Would we want to have something even of this magnitude happening to us? No we wouldn't.

This is highly distracting and the worse thing is that we have 45,000 students and more than 8,000 full-time equivalent staff toiling away every day to give this state a world class university.

STEPHANIE SMAIL: But he insists the University has done a lot of work to address problems with integrity and accountability over the past two years.

PETER H: The university and done a lot to rebuild the trust and the way we want to rebuild is by doing things better than we did before. So for example we've put in place a program where we offered all our staff to do a culture survey, 4,300 staff answered it. We collated the results and we shared it with our staff and the wider public and they were not pretty results. We did indeed have a culture issue at UQ.

STEPHANIE SMAIL: The report delivers yet another smear against the University of Queensland's reputation.

Last week it was revealed a Parkinson's disease study by former and existing staff members may not have actually been carried out. The University and the CMC are investigating what happened there too.

Kathleen Florian wants the findings in today's report to go further than the University of Queensland.

KATHLEEN FLORIAN: The CMC encourages staff across the public sector to read this report and consider how they would manage conflicts of interest and misconduct involving their most senior officers, ensuring that merit, equity and transparency remains core to decision making.

STEPHANIE SMAIL: The Crime and Misconduct Commission has ruled out criminal charges against either Professor Greenfield or Professor Keniger.